Brimbank City Council is assessing a planning permit application for a multistorey private hospital at St Albans, a key Melbourne growth area.
The hospital would have 150 beds and employ up to 50 medical staff. It would be built opposite Sunshine Hospital, and form part of the a centralised health and tertiary precinct.
Sunshine Residents and Ratepayers Association president Darlene Reilly said the proposal recognised a need in the area.
''It's a great sign that medical businesses recognise there is not only a need in the Sunshine area, but also that it is economically viable to offer medical services here,'' she said.
Ms Reilly said a new hospital could help combat many of the social issues facing the region, such as high levels of unemployment and type 2 diabetes. A decision will be made before the year's end.